Premier Foods said inflation was making more people eat at home and use its Homepride and Sharwood’s cooking sauces, providing a further boost after the UK company prospered in the pandemic.
Premier, which also makes Mr Kipling cakes, Bisto gravy and Oxo stock cubes, said it was winning market share as hard-pressed households changed their eating habits and improvised with leftovers.
The St Albans-based group, whose sales surged when UK restaurants and takeaways closed during the pandemic, said it would increase its dividend by 20 per cent to 1.2p a share.
Alex Whitehouse, chief executive, said: “Over the last year, we again saw market share gains across both our grocery and sweet treats businesses versus two years ago, and in recent weeks we’ve actually seen those market share gains strengthen further.”
Sales were still below the levels of a year earlier when coronavirus restrictions remained in place: revenues were down 4.9 per cent from the previous year at £900.5mn, but up 6.3 per cent from two years previously.
Pre-tax profit was down 16.4 per cent at £102.6mn because of a windfall from the group disposing of its stake in bread maker Hovis the previous year, but trading profit rose 11.9 per cent to £148.3mn. Shares in the FTSE 250 group rose 7.9 per cent by lunchtime to £1.15.
Whitehouse said people were “turning to brands they trust” and cooking at home rather than eating out or getting takeaways, as they “face into the uncertainty around prices and the wider economy”.
“We expect this to continue as consumers increasingly turn to creative ideas to save money and reduce waste when preparing food, so for example batch cooking and freezing leftovers,” he added.
The group has also launched new ranges such as Loyd Grossman pizza products for homemade pizzas.
It had pushed up prices in response to rapid commodity price inflation and would do so further while also seeking cost savings, Premier said. It has maintained its outlook for the year.
UK consumer price inflation reached 9 per cent in April, its highest level in more than 40 years, official data showed on Wednesday.
Premier has undergone a turnround after engaging with two groups of activist investors, cutting its debt and merging its pension schemes in a deal reached in 2020. Its sales are mostly in the UK, but it has also pushed into North America, Australia and Europe.